Invest in Deccan Transcon Leasing IPO Now – Apply between 13th and 19th Sep 2024!

Incorporated in February 2007, Deccan Transcon Leasing Limited offers tank containers on lease and provides logistic and supply chain solutions to clients in various sectors. The company offers comprehensive freight and shipping solutions, including domestic container logistics, tank fleet management, customs clearance and transportation, and Non-Vessel Operating Common Carriers (NVOCC) services. As of 31st July 2024, the company had more than 100 customers associated with it for over 3 years, and it has served more than 884 customers in the last year. Deccan Transcon Leasing has successfully built a track record of serving over 5,000 customers.

The company's services are divided into two main categories: Leasing of Containers and Shipping & Freight forwarding. Deccan Transcon Leasing mainly serves customers in industries such as chemicals, pharmaceuticals, FMCG, agriculture, and others, focusing on speciality chemicals and petrochemicals in 40 countries. The company has agencies in regions such as Europe, Asia, Oceania, South America, Africa, and the USA, handling logistics operations under an agency relationship for both inbound and outbound cargo movement. As of 31st July 2024, the company had 84 employees.

The Objectives of the Issue

Deccan Transcon Leasing Limited intends to utilize the net proceeds from the Offer towards the following objectives:

1. Capital Expenditure: Funding capital expenditure requirements towards procurement of Tank Containers.
2. Working Capital: Funding working capital requirements of the Company.
3. General Corporate Purposes: For various corporate activities aligned with the company's strategic goals.

Highlights of Deccan Transcon Leasing IPO

Deccan Transcon Leasing IPO is set to launch with a book-built issue of ₹65.06 crores. The issue combines a fresh issue and an offer for sale. Here are the key details of the IPO:

• Deccan Transcon Leasing IPO opens for subscription on 13th September 2024 and closes on 19th September 2024.
• The allotment is expected to be finalized on 20th September 2024.
• Refunds will be initiated on 23rd September 2024.
• Credit of shares to Demat accounts is also expected on 23rd September 2024.
• The company will tentatively list on NSE SME on 24th September 2024.
• The price band is set at ₹102 to ₹108 per share.
• The fresh issue comprises 55.24 lakh shares, aggregating to ₹59.66 crores.
• The offer for sale comprises 5 lakh shares, aggregating to ₹5.40 crores.
• The minimum lot size for the application is 1200 shares.
• Retail investors need to invest a minimum of ₹129,600.
• The minimum investment for HNI is 2 lots (2,400 shares), amounting to ₹259,200.
• Unicon Capital Services Private Ltd is the book-running lead manager for the IPO.
• Link Intime India Private Ltd serves as the registrar.
• Giriraj Stock Broking is the market maker responsible for 330,000 shares.

Deccan Transcon Leasing IPO - Key Dates

The cut-off time for UPI mandate confirmation is 5:00 PM on 19th September 2024. This deadline is crucial for investors to ensure their applications are processed successfully. Investors are advised to complete their applications well before this deadline to avoid any last-minute technical issues or delays.

Deccan Transcon Leasing IPO Issue Details/Capital History

The Deccan Transcon Leasing IPO is scheduled from 13th September to 19th September 2024, with a price band of ₹102 to ₹108 per share and a face value of ₹10. The total issue size is 6,024,000 shares, raising up to ₹65.06 crores. This includes a fresh issue of 5,524,000 shares aggregating to ₹59.66 crores and an offer for sale of 500,000 shares aggregating to ₹5.40 crores. The IPO will be listed on the NSE SME, with the shareholding increasing from 17,199,448 pre-issue to 22,723,448 post-issue. Giriraj Stock Broking is the market maker responsible for 330,000 shares within the issue.

Deccan Transcon Leasing IPO Allocation & Minimum Investment Lot Size

The IPO shares are allocated across different investor categories as follows:

Investors can place bids for a minimum of 1200 shares, with additional bids required in multiples of this figure. The table below illustrates the minimum and maximum investment amounts for retail investors and HNIs, expressed in shares and monetary values.

SWOT Analysis: Deccan Transcon Leasing Ltd

Strengths:

• Global footprint offering services across various continents and economic regions
• Large customer base with long-term relationships
• Advanced logistics technology solutions
• Comprehensive end-to-end logistics services
• Diverse customer base across multiple industries

Weaknesses:

• Dependence on global economic conditions and trade flows
• Potential vulnerability to fluctuations in fuel prices and currency exchange rates
• Relatively small employee base of 84

Opportunities:

• Growing demand for specialised logistics services, particularly in chemicals and pharmaceuticals
• Potential for expansion into new geographical markets
• Increasing trend towards outsourcing logistics operations by companies
• Technological advancements in logistics and supply chain management

Threats:

• Intense competition in the logistics and container leasing industry
• Regulatory changes affecting international trade and transportation
• Economic downturns impacting global trade volumes
• Potential disruptions due to geopolitical events or natural disasters

Deccan Transcon Leasing  Ltd- Financial Performance

Below are the consolidated financial results for the Fiscal years FY24, FY23, and FY22:

Deccan Transcon Leasing Limited has shown mixed financial performance over the past three fiscal years. The company's assets have grown significantly, increasing from ₹3,924.64 lakhs in FY22 to ₹7,721.58 lakhs in FY24, representing a growth of about 96.7% over two years. This substantial asset increase indicates significant expansion in the company's operational capabilities and infrastructure.

Revenue has fluctuated, rising from ₹15,319.4 lakhs in FY22 to ₹18,061.76 lakhs in FY23, then decreasing to ₹15,363.76 lakhs in FY24. The year-over-year decrease from FY23 to FY24 was 15%, possibly due to factors such as market conditions or changes in business focus.

Despite the revenue decrease, the company's profitability has seen an upward trajectory. Profit after tax rose from ₹519.1 lakhs in FY22 to ₹1,181.89 lakhs in FY24, representing a growth of 127.7% over two years. The year-over-year growth in PAT from FY23 to FY24 was 38%, showing improved operational efficiency and cost management despite reduced revenue.

Net worth has shown consistent growth, increasing from ₹1,207.59 lakhs in FY22 to ₹3,221.32 lakhs in FY24, a growth of about 166.8% over two years. This increase reflects the company's ability to generate and retain earnings, strengthening its financial position.

Total borrowings have increased from ₹989.82 lakhs in FY22 to ₹2,309.55 lakhs in FY24, an increase of about 133.3%. While this represents a significant increase, it should be viewed in the context of the company's asset growth and improved profitability.